Electronic transaction verification system with biometric authentication

ABSTRACT

An electronic transaction verification system for use with transaction tokens such as checks, credit cards, debit cards, and smart cards that gathers and transmits information about the transaction token and biometric data. Customers can be enrolled in the system by receiving customer information that includes at least a biometric datum, associating the received customer information with a transaction instrument issued to the customers and storing the received customer information and the issued transaction instrument information in a database for future reference.

CROSS-REFERENCE TO RELATED APPLICATIONS

This application is a continuation of U.S. application Ser. No.15/377,412, filed Dec. 13, 2016, which is a continuation of U.S.application Ser. No. 14/611,571, filed Feb. 2, 2015, which is acontinuation of U.S. application Ser. No. 13/934,864, filed on Jul. 3,2013, now U.S. Pat. No. 9,141,951, entitled ELECTRONIC TRANSACTIONVERIFICATION SYSTEM WITH BIOMETRIC AUTHENTICATION, which is acontinuation of U.S. application Ser. No. 12/497,512, filed on Jul. 2,2009, now U.S. Pat. No. 8,485,442, entitled ELECTRONIC TRANSACTIONVERIFICATION SYSTEM WITH BIOMETRIC AUTHENTICATION. Each of theabove-identified applications is incorporated by reference herein in itsentirety.

BACKGROUND OF THE INVENTION Field of the Invention

The present invention generally relates to credit and identityverification systems. More particularly, the present invention relatesto credit approval and fraud protection at the point-of-sale for atransaction wherein biometric information is used to verify the identityof a person presenting a token for payment as an authorized user for theassociated account and that the account is in order for the transaction.Transaction tokens can include a negotiable instrument, a credit card, asmart card, a loyalty card and a debit card. Information on theauthorized accounts can be stored in either a token-based or tokenlesselectronic transaction system.

Description of the Related Art

There are devices known in the art that gather biometric data frompersons for storage or for comparison with stored biometric data forpurposes of identity verification. An example of storing biometric datafor identity verification is U.S. Pat. No. 4,213,038 to Silverman, etal., for an access security system. Silverman, et al., discloses storinga fingerprint on a card, in either an actual print or “micropattern,”and the card is read by a control means. The fingerprint recordation isancillary to the preferred function of the card which is identificationbased upon solely the microperforation of the card, which is notdirectly related to the fingerprint.

Check funds verification systems are also known in the art that allowmerchants and others to verify that customers have funds available in aspecific checking account. U.S. Pat. No. 5,484,988 to Hills, et al.,discloses a check-writing point-of-sale system that provides for remoteverification of funds availability. Hills, et al., is particularlydirected to the purchase of goods through an electronic funds transfer.

U.S. Pat. No. 4,253,086 to Szwarcbier discloses a process and apparatusfor positive identification of customers that is particularly disclosedas using a fingerprint on a credit card and comparing the fingerprint ofthe customer to that on the card, and selectively, with a master printon file. Szwarcbier also discloses a printed fingerprint card.

There are “smart cards” known in the art which include fingerprintidentification means, such as U.S. Pat. No. 4,995,086 to Lilley, et al.,U.S. Pat. No. 4,582,985 to Löfberg, U.S. Pat. No. 4,993,068 to Piosenka,et al., and U.S. Pat. No. 5,180,901 to Hiramatsu. All of thesereferences disclose smart cards that have, at least, a storedfingerprint in a local memory (such as magnetic tape or integratedcircuit) that interacts with a reading means at the point-of-sale toassist in customer identification.

An example of an actual fingerprint sensor is U.S. Pat. No. 5,745,096 toHsumi, et al., which is for a surface-shaped sensor identificationdevice. The Hsumi, et al. device is focused on the specific element ofsensing and recording the fingerprint, as opposed to a complete identityverification system.

There are various types of biometric measurements in common use today.The types of biometric measurements include fingerprint verification,hand geometry, voice recognition, retinal scanning, iris scanning,signature verification, and facial recognition. Each biometric deviceand system has its own operating methodology. The process for any givenindividual usually begins with an enrollment process. The systemcaptures one or more samples of the biometric. The samples are stored ina “biometric template” (also referred to herein as a biometricdatabase), and are used for future comparison during authentication.Once enrollment and storage are complete, users authenticate themselvesby matching the template against current input (“live data”). Comparisonof the live data and the template results in a simple binary yes/nomatch.

Fingerprint verification is a well-known type of biometric measurement.If properly implemented, fingerprints provide high accuracy and atrelatively low cost. Hand geometry measures physical characteristics ofthe individual's hand and fingers and is widely used in physical accesscontrol systems. Voice recognition remains difficult to implement.Despite recent advances in voice recognition technology, backgroundnoise, microphone quality, the common cold, and anxiety can alter thehuman voice enough to make voice recognition difficult, if notimpossible. Voice recognition technologies include telephoneauthentication. Extraction and pattern matching algorithms embedded oncomputer chips are used to analyze voices. Retinal scanning is wellestablished and highly accurate, however, it requires that theindividual look directly into the retinal reader. Retinal scans shoot alow-intensity beam of light into the eye and record the pattern of veinsin the eye. Iris scanning overcomes most of the problems of retinalscanners and does not require direct contact with the scanner, nor doesit require the individual to remove eyeglasses. The technology works byscanning the unique random patterns of the iris. Unlike retinal veinpatterns that can change over time, the iris is unique and does notchange during a person's lifetime. Facial recognition systems measurecharacteristics such as the distance between facial features (e.g.,pupil to pupil) or the dimensions of the features themselves (such asthe width of the mouth). Neural network technology or statisticalcorrelations of the facial geometric shapes are used with this kind ofsystem. Signature verification is a relatively accurate system and istreated separately from the other forms of biometric systems describedherein.

With fraudulent check losses alone reaching ten billion dollarsannually, the banking industry is striving for ways to reduce theselosses. Many proposals have been presented over the last five to tenyears. One approach is placing the individual's fingerprint on a stickerand attaching the sticker to the check being presented. Among the moresophisticated approaches is the use of smart cards that have a chipcontaining biometric information of the account holder. The biometricinformation stored on the chip can be compared with the biometricinformation of the person presenting the smart card at the transactionlocation. However, these alternative methods of reducing fraudulentactivity are not meeting the needs of industry. The use of fingerprintstickers are a deterrent for a less sophisticated forger, but theprocess of identifying the fingerprint on a sticker can take a long timein crime labs due to their backlog and their obvious priority ofprocessing fingerprints obtained from crime scenes in which feloniesinvolving violence occurred. Smart cards with embedded biometric chipsare used with credit cards or debit cards, but still do not prevent themore sophisticated identity thief. The more sophisticated identity thiefsteals account information and then produces his own credit cardcontaining his own biometric information embedded in the chip. When theidentity thief presents his biometric information at the transactionlocation, the verification is being made against an already faultybiometric sample stored on the chip.

Tokenless point-of-sale payment processing systems have also beendeveloped recently. One such system is described in U.S. Pat. No.6,581,042 to Pare, et al. that uses biometrics obtained at thepoint-of-sale for verifying the identity of an individual as anauthorized user of the tokenless payment system. Tokenless processingsystems are intended to speed up the process of check-out at atransaction location by not requiring the person to present a physicaltoken and by verifying the identity of the person presenting paymentwith the tokenless processing system. A drawback of current tokenlesssystems is that they only verify tokenless transactions. Tokenlesssystems do not verify the individual's identity or cross compare with atoken-based transaction processing system when a transaction token ispresented for payment at the point-of-sale. Therefore, unless thetokenless transaction system can be combined with verification of tokentransactions presented at the point-of-sale the tokenless transactionsystem does not prevent and is vulnerable to fraud. For example, aperson registers with the tokenless processing system by providingaccount information and a biometric for identification during theprocessing of purchases at the point-of-sale by the tokenless processingsystem. The person registering with the tokenless system believes thatall purchases will be authenticated by his biometric. However, this doesnot prevent a thief from either stealing or fabricating the registeredperson's physical token (e.g., check, credit card, etc.) and presentingit at a location that uses the tokenless processing system. Unless thephysical token presented is checked against the tokenless processingpayment system to determine if the account being accessed needs to beauthenticated by a biometric, the physical token could be acceptedwithout verifying the identity of the person presenting the token forpayment.

SUMMARY

Various embodiments described herein, combine the use of valid biometricsamples obtained from authentic identifications (IDs) with biometricsamples provided by a person at a transaction location, therebyverifying that the biometric information presented for a transaction isa valid biometric for a particular person. In addition, the ID and thebiometric sample can also be checked against known invalid users.Although it is possible for someone to counterfeit what is believed tobe the authentic ID, in such cases, the identity thief provides anactual fingerprint that has been taken and placed on the token or on thetransaction slip. When the token is returned to the transaction locationas forged, counterfeit, stolen, etc., the fingerprint is entered intothe database of known invalid users, thus preventing any furtheridentity theft activity by this person on the verification system.Various embodiments add additional safeguards, such as verifying the IDwith information from the state. This ensures that an ID has not beenaltered, and is in fact an authentic state-issued ID (e.g., driver'slicense). Another such safeguard is verifying the information at theprocessing center of the token with the original information that a bankor token company obtained at the creation of the bank or token account.

Various embodiments include a verification system for check/negotiableinstruments or other form of tokens, which has the ability to scan theinformation from negotiable instruments such as the magnetic inkcharacter recognition (MICR) line, and gather biometric data such asfingerprints. The system alternately and/or additionally scans driver'slicenses or other identification cards, and obtains and transmits asignature of a customer, preferably all occurring at a transactionlocation (e.g., point-of-sale) for purposes of identity and fundverification. However, the electronic transaction can occur at placesother than a point-of-sale. For example, the electronic transaction canoccur over the Internet, as part of an Internet-based transaction andinclude transmission of biometric data or signatures for userverification. Therefore, in general, transaction location refers to theplace where the user or customer enters his information, such as accountdata or biometric data into the electronic transaction verificationsystem. The verification system preferably digitizes various indicia ofthe check, the preferred indicia being the magnetic ink (MICR line) onthe check, tendered by the customer at the transaction location, andtransmits the data through a communications medium, to a processingsystem including a negotiable instrument information database, wherebythe inputted data is compared with an existing database of informationto determine if the customer at the point-of-sale is in fact authorizedto use the account, and if the account is in satisfactory condition fortransaction approval. The communications medium can be a broadbandconnection, a dial-up connection, a direct communications link, asatellite link, or fiber optic cable or any other communication linkthat allows communications between a transaction location and a centralor local processing system and database.

In this exemplary embodiment, the verification system alternativelyincludes a device and method for recording and/or transmitting abiometric measurement of the customer at the location of the transactionand, in the case of a fingerprint biometric, printing the fingerprint onthe negotiable instrument, either in actual or digitally encoded form,such that the fingerprint can be later checked against a biometricdatabase of existing fingerprints at such time as the instrument isprocessed at a bank, which provides an added means of security in theevent that fraudulent activity has been discovered between the time ofreceiving the token at the transaction location and the time it ispresented at the processing center. If the system includes a device forscanning an information card that contains biometric data, such as aproper fingerprint printed on a driver's license, and/or signature, thenthe fingerprint and signature of the user can alternatively be comparedto the recorded data on the card, in addition to or instead of,transmission of the various databases.

In another embodiment of the verification system, a negotiableinstrument or other token is swiped and the fingerprint issimultaneously taken and digitized whereby the combined data istransmitted to a central (or local) processing system that includes anaccount information database and a biometric database, and thetransmitted data is compared with identification data already on file,and the central (or local) processing system determines if theidentification data of an authorized user on file matches with thetransmitted data from the user at the transaction location. Localsystem, in the present context refers to a system that is in physicalproximity to the transaction location (e.g., same store). The systemthen returns the results of the decision on approval to the transactionlocation. A device at the transaction location displays the decisiondata and/or prints out a hard copy indicating whether the negotiableinstrument/token was approved or denied.

As is well known in the banking industry, the MICR line on a checkincludes the bank routing number, account number, check number, checkamount, and other information, that can be printed near the bottom ofthe check in magnetic ink in accordance with generally applicableindustry standards. In operation, the central (or local) processingsystem receives data from the transaction location and then determinesif the “ABA” magnetic number on the MICR line of the check is a validnumber, if the fingerprint data is that of an account owner authorizedto use that account, and/or if the signature is that of the authorizedaccount owner, whereby any negative response to these decisionspreferably causes return of the data indicative of the negative responseto the transaction location. Upon affirmative indications in thedecisions, the central (or local) system retrieves the frequency of theaccount accesses to determine if the current requested access is inexcess of a pre-determined limit of an allowable number of accesses. Ifthe current access is in excess of the pre-determined allowable limit,then the data is returned to the transaction location indicating theunacceptable request to exceed the limit, and thus, disapproval of thetransaction. If the current access is not in excess of the allowabledetermined limit, then the verification of the check is approved andsuch verification is used to update the frequency of account accessdatabase, and the approval is returned to the transaction location.Various account conditions can be used, alternatively, to verify thecondition of an account. Such conditions can include “outstandingchecks,” “returned checks,” and “account closed” among others. Forexample, if there are outstanding checks on the system for a user'saccount, then in various embodiments, an indication can be returned tothe transaction location that the user's account is not in condition tosatisfy the negotiable instrument. Likewise, if the token is a creditcard, debit card, loyalty card, smart card or similar-type token, thecondition of an account can include “exceeding credit limit,” unpaidbalance,” “insufficient funds,” etc.

In a further exemplary embodiment, the transaction database and/or thebiometric database within a tokenless payment system can be used toverify or authenticate the person presenting a token at the transactionlocation. The token being presented at the transaction location isswiped obtaining the necessary account information and sent to aprocessor for comparison with account information stored in thetransaction information database within the tokenless processing system.If a match occurs with account information stored in the transactiondatabase of the tokenless system, the token system then requires thetoken to be authenticated by a biometric. The biometric information isthen sent either separately or in parallel with the transactioninformation to the tokenless system for approval.

The verification system preferably includes the capability to providereports on user/customer activity to a merchant or business uponrequest. The merchant directs an inquiry to the central (or local)system which is in communication with a series of databases and whichpreferably includes databases indicative of: a number of transactionsfor a specific account; the location of the transactions for suchaccount; and a user/customer list and relevant data associated with theuser/customer. Depending upon the inquiry generated from the merchant,the main (or local) system retrieves the requested information togenerate a report on a specific customer, and then returns the report tothe merchant.

Alternatively, the verification system can be used in conjunction with abank proofing machine during batch processing of checks. When theproofing machine scans the magnetic number from the check, theidentification data imprinted on a check at the transaction location iscompared with account owner identification data as recorded andmaintained by the bank to determine if the correct account ownersubmitted the check. The verification system can also be used inconjunction with an Electronic Check Exchange (ECE) system in which thecheck information is exchanged electronically, in lieu of or in additionto the exchange of paper checks. For forward presentment, an ECE systemis usually referred to as an Electronic Check Presentment (ECP) system.The verification system can be used in conjunction with AutomaticClearinghouse (ACH) processing systems. Furthermore, the verificationsystem can be used in conjunction with a token processing system such asa credit card or debit card processing center to verify the informationread from the magnetic strip on the token with information recorded andmaintained by the credit or debit card processing center.

In various embodiments, a transaction verification system or anegotiable instrument system for use at a location where a transactioninstrument (e.g. a check, a negotiable instrument, a cashiers check,money order, token, credit card, debit card, check card, decoupled debitcard, a physical object or device that includes a user's financialaccount information, a physical object or device that includesinformation representative of a user's financial account information, afood stamp, etc.) is disclosed. The system comprises a transactioninstrument scanner (sometimes referred to as a negotiable instrumentreader) that is configured to read encoded information on thetransaction instrument when it is presented by a receiving entity. Thesystem further comprises a biometric scanner (sometimes referred to as abiometric reader) configured to generate a biometric data from anindividual representing the receiving entity and an electroniccommunication system configured to transmit information to a centralprocessing system and receive information from the central processingsystem. In various embodiments, the central processing system can be incommunication with the transaction instrument scanner and the biometricscanner. In several embodiments, the central processing system cancomprise one or more information stores configured such that the one ormore information stores include information associated with a pluralityof transaction instruments previously provided by an issuing entityissuing the plurality of transaction instruments. In variousembodiments, the one or more information stores can further includebiometric information from a plurality of receiving entities, each ofthe plurality of receiving entities having received at least one of theplurality of transaction instruments from the issuing entity. In variousembodiments, the transaction instrument information and the biometricdata are compared to the one or more information stores, and a result ofthe comparison is analyzed to determine if the transaction instrumentshould be accepted.

In various embodiments, a transaction verification system or anegotiable instrument system for use at a location where a transactioninstrument (e.g., a check, a negotiable instrument, a cashiers check,money order, token, credit card, debit card, check card, decoupled debitcard, a physical object or device that includes a user's financialaccount information, a physical object or device that includesinformation representative of a user's financial account information, afood stamp, etc.) is disclosed. The system includes a transactioninstrument scanner (sometimes referred to as a negotiable instrumentreader) that is configured to read encoded negotiable instrumentinformation from a negotiable instrument issued by an issuing entity.The system further includes a biometric scanner (also referred to as abiometric data reader) configured to generate biometric data from anindividual representing the receiving entity and an electroniccommunication system configured to transmit at least negotiableinstrument information and the biometric data to a central processingsystem and receive information from the central processing system. Invarious embodiments, the central processing system can be incommunication with the transaction instrument scanner and the biometricscanner. In several embodiments, the central processing system can beconfigured to access one or more information stores, the one or moreinformation stores including information associated with a configuredsuch that the one or more information stores include informationassociated with a plurality of transaction instruments (or negotiableinstruments). The negotiable instrument information stored in the one ormore information stores is previously provided by the issuing entity. Invarious embodiments, the one or more information stores can furtherinclude biometric information associated with a plurality ofindividuals, each of said plurality of individuals associated with thereceiving entity. The electronic communication system is furtherconfigured to provide an indication as to whether the negotiableinstrument should be accepted, said indication based on a comparisonbetween the negotiable instrument information, the biometric data anddata from the one or more information stores. In various embodiments,the comparison can be performed by the negotiable instrument system, orthe central processing system, or by an electronic system at a remotelocation.

Various embodiments described herein disclose a method of processing atransaction (or negotiable) instrument issued by an issuing entitytendered by a receiving entity. The method includes receiving, encodedinformation associated with the transaction (or negotiable) instrumenttendered by the receiving entity. The encoded information can beobtained by a transaction instrument scanning device or a negotiableinstrument reading device. The method further includes obtainingbiometric information, related to an individual associated with thereceiving entity tendering the transaction (or negotiable) instrument.In various embodiments, the biometric information can be obtained by abiometric scanning device or a biometric information reader. The methodfurther includes accessing information from one or more informationstores accessible via a central processing system and comparing theinformation obtained from the transaction instrument and the biometricinformation with the accessed information. In various embodiments, theone or more information stores can include information associated with aplurality of transaction (or negotiable) instruments, said informationpreviously provided by an issuing entity, and biometric informationrelated to a plurality of individuals. Each of the plurality ofindividuals can be associated with at least one receiving entity. Invarious embodiments, each receiving entity may have received at leastone transaction (or negotiable) instrument from the issuing entity. Adetermination of whether the transaction instrument should be acceptedor rejected is made based on a result of the comparison. The result ofthe comparison or the decision regarding accepting or rejecting thetransaction instrument can be communicated to an output device. Invarious embodiments, the output device may include but not be limited toa display device or a printing device. In various embodiments, thenegotiable instrument information and the biometric information can bereceived in substantially real time.

Various embodiments described herein disclose a method of processing atransaction at a location where a transaction token is presented by anindividual. The method includes obtaining encoded information from atransaction token at the time the transaction token is tendered by anindividual. The encoded information can be obtained using a deviceconfigured to read the token. The method further includes obtainingbiometric information from the individual tendering the transactiontoken. The biometric information can be obtained using a biometricreader. The method further includes accessing one or more informationstores to determine if any biometric information is associated with thetransaction token and if no biometric information is associated with thetoken, then the biometric information obtained from the individual isassociated with the transaction token in the one or more informationstores. The biometric information obtained for a few initial uses canserve as a template by which subsequent transactions can be verified.For example, in various embodiments, the biometric information obtainedat a subsequent time the transaction token is presented by theindividual can be compared to the biometric information previouslyassociated with the transaction token to verify that the individual isan authorized user of the token. If it is determined, that thetransaction token is invalid because it is forged or counterfeit and/orthe obtained biometric information does not match the previously storedbiometric information, then the biometric information associated withthat token can be added to an information store that includes a list ofinvalid users.

Various embodiments described herein disclose a method of processing atransaction token. The method includes enrolling one or more users in averification system, the enrolling process including receiving userinformation related to one or more users, the user information includingat least a biometric datum; receiving transaction token informationassociated with one or more transaction tokens issued to the one or moreusers by an issuing entity and storing said user information andtransaction token information in one or more data stores accessible by acentral processing system. The method further comprises providing saidstored user and transaction token information to a transaction tokenprocessor. The method further includes processing a transaction tokenincluding receiving, in substantially real time, encoded informationfrom the transaction token tendered by a user, the encoded informationobtained by a transaction token reading device and also receiving, insubstantially real time, biometric data from the user tendering thetransaction token, the biometric data obtained by a biometric scanningdevice. The method further includes accessing the one or more datastores and comparing the encoded information obtained from thetransaction token and the biometric data obtained from the user withinformation stored in the one or more data stores. The method furtherincludes determining if the transaction token should be accepted basedon a result of the comparison; and communicating to a system point ofaccess, in substantially real time, the result of the determination. Invarious embodiments, enrolling the one or more users is performed priorto processing the transaction token. In various embodiments, thetransaction token information is provided by the issuing entity everytime a transaction token is issued, for example, every week, every twoweeks or every month. In various embodiments, the biometric informationincludes a finger print, a retinal scan or a face scan. In variousembodiments, the transaction token includes a physical object thatincludes information representative of the individual's or issuingentity's account information. In various embodiments, the transactiontoken includes a negotiable instrument, a credit card, a debit card, aloyalty card, a decoupled debit card, a device enabled with radiofrequency identification, a smart card, a flash drive, a usb thumbdrive, a usb pen drive, a usb pin drive, or food stamp.

Various embodiments described herein disclose a method of processing atransaction token. The method includes enrolling one or more users in averification system, the enrolling process including receiving userinformation related to one or more users, the user information includingat least a biometric datum; receiving transaction token informationassociated with one or more transaction tokens issued to the one or moreusers by an issuing entity and storing said user information andtransaction token information in one or more data stores accessible by acentral processing system. The method further comprises providing saidstored user and transaction token information to a transaction tokenprocessor. The transaction token processor can be configured toreceiving encoded information related to the transaction token tenderedby a user, the encoded information obtained by a transaction tokenreading device and also receiving, biometric data associated with theuser tendering the transaction token, the biometric data obtained by abiometric scanning device. The method further includes accessing the oneor more data stores and comparing the encoded information obtained fromthe transaction token and the biometric data obtained from the user withinformation stored in the one or more data stores. The method furtherincludes determining if the transaction token should be accepted basedon a result of the comparison; and communicating to a system point ofaccess the result of the determination. In various embodiments,receiving the encoded transaction token information, receiving thebiometric information and communicating the result of the determinationcan be performed in substantially real time. In various embodiments,enrolling the one or more users is performed prior to processing thetransaction token. In various embodiments, the transaction tokeninformation is provided by the issuing entity every time a transactiontoken is issued, for example, every week, every two weeks or everymonth. In various embodiments, the biometric information includes afinger print, a retinal scan or a face scan. In various embodiments, thetransaction token includes a physical object that includes informationrepresentative of the individual's or issuing entity's accountinformation. In various embodiments, the transaction token includes anegotiable instrument, a credit card, a debit card, a loyalty card, adecoupled debit card, a device enabled with radio frequencyidentification, a smart card, a flash drive, a usb thumb drive, a usbpen drive, a usb pin drive, or food stamp.

Accordingly, various embodiments described herein have a practicalapplication in that they provide an electronic transaction verificationsystem to a merchant for use at a transaction location, which determinesif the user/customer is authorized to use a specific account, and if theaccount is in satisfactory condition to remit funds for the negotiableinstrument drawn against it.

Various embodiments of the electronic transaction verification systemdescribed herein further have industrial applicability in that theyprovide a computer system which correlates biometric data that isprecise with not easily forgeable measurements of a customer, such asfingerprints and/or data from identification cards, and that can bedigitally encoded and processed along with the information relative to anegotiable instrument such that the risk of the merchant accepting a badinstrument is greatly reduced. Thus, the various embodiments can bequite economically beneficial to a merchant utilizing the system.

More generally, the embodiments described herein are applicable toelectronic transaction verification of a person initiating a transactionwith a token at a transaction location. In various embodiments, withoutlimitation, a transaction token can include a negotiable instrument, acheck payable on demand, a substitute check, a traveler's check, a debitcard, a credit card, a smart card, a promissory note, food stamps, orany other token presented at the point-of-sale for payment. Thepoint-of-sale can be a physical or virtual (i.e., web site) storelocation. The token is presented at a transaction location to a vendoror merchant. The transaction is initiated by the user presenting a tokenat the transaction location along with a biometric measurement beingtaken to verify the identity of the individual against informationstored in a database. Information read electronically from the token isused to determine the condition of a user account.

A substitute check, as used herein, has the meaning given to it in the“Check Clearing for the 21^(st) Century Act,” Public Law 108-100, Oct.28, 2003. A substitute check is a legal equivalent of the original checkthat has been truncated. It contains an image of the front and back ofthe original check and bears a MICR line containing all informationappearing on the MICR line of the original check.

BRIEF DESCRIPTION OF THE DRAWINGS

The disclosure is better understood by reading the following detaileddescription of the various embodiments in conjunction with theaccompanying drawings.

FIG. 1 is a block diagram of an exemplary embodiment of the electronictransaction verification system illustrating a verification unit incommunication with a central processing system and identificationdatabase.

FIG. 1A is a block diagram of an exemplary embodiment of the electronictransaction verification system illustrating a verification unit incommunication with a central processing system, a plurality ofinformation stores and an output device.

FIG. 1B is a block diagram illustrating a method to enroll users in atransaction verification system.

FIG. 2 is a block diagram illustrating an embodiment of the electronictransaction verification unit whereby the electronic transactionverification unit is in communication with a central database thatreturns an approval decision to the electronic transaction verificationunit.

FIG. 2A is a block diagram illustrating an embodiment of the transactionverification system whereby the electronic transaction verification unitis in communication with a central database that associates biometricinformation with a transaction instrument and returns an approvaldecision to the electronic transaction verification unit.

FIG. 3 is a flow chart of another embodiment of the verification systemillustrating the electronic transaction verification unit transmittingthe identifying data of a check and a fingerprint to the central systemfor processing.

FIG. 4 is a flow chart illustrating the processing of transmitted databy the central system upon receipt of the data from the electronictransaction verification unit at the transaction location.

FIG. 5 is a block diagram illustrating the main system generating acustomer report based upon receipt of an inquiry from a retailer.

FIG. 6 is a block diagram illustrating a proofing machine interactingwith the biometric data scanner at the transaction location, with theinterrelation of a first biometric database for known customers and asecond biometric database for known invalid data.

FIG. 7 illustrates an exemplary embodiment of the electronic transactionverification system including a verification unit operating inconjunction with a tokenless processing system having its owntransaction and biometric databases.

DETAILED DESCRIPTION OF THE VARIOUS EMBODIMENTS

The following detailed description is directed to certain specificembodiments. Those skilled in the relevant art will recognize that manychanges can be made to the embodiments described, while still obtainingthe beneficial results described herein. It will also be apparent thatsome of the desired benefits of the various embodiments described hereincan be obtained by selecting some of the features of the embodimentsdescribed herein without utilizing other features. Accordingly, thosewho work in the art will recognize that many modifications andadaptations to the present invention are possible and may even bedesirable in certain circumstances and are a part of the presentinvention. Thus, the following description is provided as illustrativeof the principles of the various embodiments of the electronictransaction verification system and not in limitation thereof, since thescope of the present disclosure is defined by the claims.

Referring now in greater detail to the drawings, in which like numeralsrepresent like components throughout the several views, FIG. 1illustrates a block diagram of an exemplary embodiment of theverification system illustrating an electronic transaction verificationunit 10 in communication with a central processing system 12 thatincludes an identification database 14. Embodiments of the variouselectronic transaction verification systems usable with systems andmethods of the present disclosure are described in the co-pending U.S.patent application Ser. No. 12/050,772 titled “Electronic TransactionVerification System” filed on Mar. 18, 2008, published as U.S.Publication No. 2008/0156866 on Jul. 3, 2008, which is incorporated byreference herein in its entirety. The identification database 14 caninclude a number of databases used in the identification process such asa biometric database of known customer data, as well as a separatedatabase of known invalid users. The database of known invalid users canbe established by correlating a biometric presented at a transactionlocation that is used with a fraudulently obtained transaction token,and storing the biometric as invalid. Central processing system 12 canbe a main system remote from the transaction location. While a check isdisclosed as one type of token to be processed in an exemplaryembodiment of the present inventive system, other tokens can beprocessed in the same manner as disclosed herein. Negotiable instrument,as the term is used herein is defined in Article 3 § 104 of the UniformCommercial Code. An instrument is negotiable if it is: (1) a writteninstrument signed by the endorser or maker; (2) an unconditional promiseto pay a certain amount of money, either on demand or at a future date;and (3) payable to the holder or bearer. Examples of negotiableinstruments are checks, bills of exchange, and promissory notes. A checkas used herein means a draft, payable on demand and drawn on a bank, ora cashier or teller's check. This is the customary definition of acheck. The exemplary embodiment of the electronic transactionverification unit 10 is comprised of, at least, a check scanner or tokenreader 16 and a biometric data-gathering device 18, such as afingerprint recording device.

Many check scanning devices are known in the art that scan the magneticink on the bottom of checks and such devices range in use frompoint-of-sale devices to scanners used at banks, where the more advanceddevices are referred to as bank “proofing” machines. However, suchdevice alternately and/or additionally includes the capability of videodigitization of the check or gathering of other characteristics of thecheck that are useful for comparison.

The biometric recording device 18 preferably digitizes the fingerprintof a customer at the point-of-sale for transmission to a remotebiometric database. Many devices for digitization and transmission offingerprints are well known in the art, such as the devices of digitalbiometrics. Other biometric devices such as retinal scanners andvoiceprints are alternately and/or additionally used with, or in lieuof, the exemplary fingerprint scanner. Such biometric devices arecommercially available and adaptable for use with the variousembodiments of the electronic transaction verification system describedherein. The electronic transaction verification unit 10 also preferablyincludes a card reader/scanner, such as a driver's license scanner 20which scans information from a driver's license, which is especiallyuseful in states that put information, such as fingerprints, in acomputer-readable medium such as a magnetic strip (e.g., a Californialicense) or a bar code (e.g., a Georgia license) on the driver'slicense. When the license contains this information, the electronictransaction verification unit 10 can perform an initial comparisonbetween the biometric recorder device 18 and the device's licensescanner 20 for determination of the user's/customer's identity, inaddition to or instead of, transmitting biometric data to the biometricdatabase of the central processing system 12. The information gatheredfrom the license scanner 20 can also be verified with informationlicensed from a state division of motor vehicles in order toauthenticate a driver's license. Finally, the electronic transactionverification unit 10 preferably includes a signature-taking device 22that allows a customer to write his or her signature on the device thatthen encodes the signature into digital format for transmission. Suchtransmissions can occur with or separately from the transmission of thecheck identification and biometric data. There are many devices known inthe art that allow a signature to be digitized for storage andcomparison, and any of such devices will work satisfactorily in thepresent inventive system.

The electronic transaction verification unit 10 is preferably a computerplatform which has the capability to receive, digitize and process theincoming data from the devices, shown by block 24, for transmission to acentral processing system 12. The central processing system 12 can beremotely located from the electronic transaction stations or can be atthe same location as the electronic transaction station, e.g., anin-store central processor and database connected to electronictransaction stations by a local area network. The other devices can beintegrated with the computer platform of the electronic transactionverification unit 10, however, the devices can also be independent fromthe computer platform as long as they are in connection with theelectronic transaction verification unit 10 sufficient to transmit andhave received by the unit 10 the relevant data from the devices. Thecentral processing system 12 is in connection with, at least, anidentification database 14, which at a minimum contains the relevantspecific identification data related to various checking and/or creditaccounts. The identification database 14 can be a hard drive on thecentral processing system 12, computer platform, or other type of memorydevice located either locally or remotely, but in connection with, thecentral processing system 12. Thus, in a basic form, the embodimentsdescribed herein solely generate and record identification data of thecustomer relevant to a single sale and acceptance of a token at atransaction location through recordation of the specific tokenidentification and biometric data of the customer at the transactionlocation, which is then transmitted by the various devices of theelectronic transaction verification unit 10 for recordation. When thesimple recordation of the event is effected, it is preferable that theelectronic transaction verification unit 10 output a fingerprint (orother biometric data) for inputting on the specific check, negotiableinstrument, or in conjunction with another type of token at thetransaction location, shown by output 26, either in actual or digitallyencoded form, whereby this identifying characteristic of the personcashing or tendering the check is contained upon the check itself andbanks processing the check have the capability to compare that imprintedfingerprint with fingerprints on file for the actual account holders, ifnecessary. However, the printing of the fingerprint on the check or inconjunction with the token (e.g., credit card receipt) can bealternately and/or additionally used in any embodiment of the presentinventive verification system.

Various embodiments of the system described herein can be used toverify, validate and/or process various transaction instruments issuedby an issuing entity to a receiving entity. As used herein, atransaction instrument can include but is not limited to personalchecks, payroll checks, cashier or teller's check, traveller's check,negotiable instruments, a draft payable on demand and drawn on a bank,money orders, credit cards, debit cards, decoupled debit cards, loyaltycards, check cards, smart cards, flash drives, usb thumb drives, usb pendrives, usb pin drives, memory stick, food stamps, tokens, etc. Invarious embodiments, the transaction instrument or a transaction tokencan include a physical object, apparatus or device that holdsinformation related to one or more financial accounts associated with auser. In some embodiments the transaction instrument or transactiontoken can include a physical device that is enabled with radio frequencyidentification (RFID) tag that holds information associated with orrepresentative of one or more financial accounts associated with a user.As used herein an issuing entity can be any entity that issues thetransaction instrument. Examples of issuing entities include but are notlimited to an individual, an employer, a corporation, municipal, stateand federal government, etc. As used herein, a receiving entity can beany entity to whom the transaction instrument is issued by the issuingentity. Examples of a receiving entity are individuals, employees,corporations, partnerships, etc. As an example, in some embodiments, thereceiving entity is an employee of the issuing entity which is anemployer or a company. In this example, the employee can receive apayroll check or a reimbursement check from the employer.

In various embodiments, the receiving entity can exchange thetransaction instrument for money, goods and/or commodities at atransaction facilitating entity. As used herein, a transactionfacilitating entity is an entity that accepts and processes varioustransaction instruments described above and exchange these transactioninstruments money, goods and/or commodities. Examples of transactionfacilitating entities are banks, retailers, super-markets, check cashingcompanies, payment processing companies, etc.

FIG. 1A is a block diagram of an exemplary embodiment of theverification system illustrating an electronic transaction verificationunit 10 in communication with a central processing system 12 and aplurality of information stores 17 that can be used process varioustransaction instruments at a transaction location. In variousembodiments, the transaction location can include the transactionfacilitating entity's premises. As described above, in some embodiments,a part of the verification system illustrated in FIG. 1A can be locatedat the transaction location and another part can be located at alocation remote to the transaction location. For example in someembodiments, the electronic verification unit 10 can be provided at thetransaction location, while the central processor 12 and the pluralityof information stores 17 can be provided at a location remote from thetransaction location and accessed for example, via a network such as theInternet. However, in other embodiments, the central processor 12 andthe plurality of information stores 17 can be provided at thetransaction location. Although, a plurality of information stores 17 isillustrated in FIG. 1A, a single information store can also be used insome embodiments. As described herein, the plurality of informationstores 17 can include databases, relational databases, lists or othertypes of data stores that can be accessed electronically.

Upon presentation of the transaction instrument, the verification systemcan scan and/or read the transaction instrument to obtain informationencoded therein by a reading device 16 configured to scan and/or readthe transaction instrument. In various embodiments, the reading device16 can be a check scanner or a token reader as described above. Invarious embodiments, the encoded information can include but is notlimited to name of the receiving entity, “ABA” number, account number,card number, serial number or check number, date of issue of thetransaction instrument, expiry date of the transaction instrument, thevalue of the transaction instrument, the amount specified on thetransaction instrument, etc.

The verification system can also obtain biometric information from theindividual presenting the transaction instrument using the biometricdata gathering device 18 described above. In various embodiments, thebiometric information can be at least one fingerprint, a retinal scan orsome other biometric signature. The encoded information and thebiometric information gathered by the verification system can betransmitted to the central processor 12 by an electronic communicationsystem as shown by the logic block 28.

In various embodiments, the electronic communication system can includea wired or a wireless network. In various embodiments, the gatheredinformation may be transmitted to the central processor 12 insubstantially real time such that central processor 12 receives thegathered information in less than approximately 1 minute, 2 minutes, 3minutes or 5 minutes after the transaction instrument is scanned orread. In some embodiments, the gathered information may be transmittedto the central processor 12 over a time period which extends over a fewhours or a few days. As described above with reference to FIG. 1, theverification system may also scan information from the driver's licenseof the individual presenting the transaction instrument using a driver'slicense scanner 20 and transmit the driver's license information to thecentral processor 12 in addition to the encoded information from thetransaction instrument and the biometric information.

The central processor 12 is configured to access one or more informationstores 17 to verify, validate and/or process the received information.For example, in some embodiments, the central processor 12 can accessdata and/or one or more lists stored in the one or more informationstores 17. The plurality of information stores 17 and the data storedtherein can be maintained by a transaction validating entity thatverifies, validates and/or processes transaction instruments. Examplesof transaction validating entities are banks, financial institutions,payment processing companies, check clearing companies, etc. In variousembodiments, the transaction facilitating entity and the transactionvalidating entity may be same.

The data and lists can be previously provided to the transactionvalidating entity by an individual or a company associated with theissuing entity. In various embodiments, the lists can includeinformation associated with a plurality of transaction instrumentsissued by the issuing entity and biometric information of one or moreindividuals associated with or representing one or more receivingentities. In some embodiments, the individual whose biometricinformation is included in the list can be the receiving entity. Inother embodiments, the individual whose biometric information isincluded in the list can be a person authorized by the receiving entityto act on its behalf. In various embodiments, the issuing entity canobtain the biometric information while registering or enrolling thereceiving entity in a transaction verification system such as a payrollprogram whereas in other embodiments, the biometric information gatheredthe first few times a transaction instrument is presented can provide atemplate by which future transactions are verified. A method ofenrolling individuals associated with or representing one or morereceiving entities in a transaction verification system is illustratedin FIG. 1B and further described below.

If the encoded information obtained by the reading device 16 matches anitem in one or more information stores 17 and the biometric informationobtained from the biometric data gathering device 18 matches the storedbiometric information for the individual associated with the receivingentity to whom the transaction instrument was issued, then thetransaction validating entity can make a decision to approve thetransaction. However, in some embodiments, if the obtained encodedinformation does not match any item in the one or more informationstores 17 and/or the biometric information does not match the storedbiometric information for the individual associated with the receivingentity, then the transaction validating entity can reject thetransaction. Alternatively, if the obtained encoded information and/orthe biometric information does not match one or more entries in the oneor more information stores, then the transaction validating entity canseek approval from the issuing entity prior to making a decision on thetransaction.

The decision can be returned to the transaction location as illustratedby the logic block 48. In various embodiments, the decision can beoutput to an output device as shown in the output block 21. In variousembodiments, the output device can include but not be limited to adisplay device or a printing device or both. Other types of outputdevices known to persons having ordinary skill in the art can be alsoused. In various embodiments, the above described method can performedin substantially real time such that a decision on the transactioninstrument can be returned to the transaction location and output to theoutput device in less than approximately 1 minute, 2 minutes, 3 minutesor 5 minutes from the time the transaction instrument is read orscanned. In some embodiments, the decision on the transaction instrumentcan be returned to the transaction location in a time period whichextends over a few hours or a few days from the time the transactioninstrument is read or scanned.

FIG. 1B illustrates an embodiment of a method to enroll users in atransaction verification system. In various embodiments, the users ofthe transaction verification system can be individuals associated withor representing one or more receiving entities. In various embodiments,the transaction verification system can have some similarities withvarious fraud detection and prevention systems such as POSITIVE PAY.

To enroll users in the transaction verification system, an issuingentity or an individual or company associated with the issuing entitygathers user information as shown in block 4. The gathered userinformation may include information such as name, identification number(e.g., social security number, employee identification number, etc.),date of birth, address, etc. The gathered user information can alsoinclude biometric data associated with the user. The biometric data asreferred to herein includes a characteristic of the user's body. Forexample, biometric data can include but not be limited to related to anyone or more of a user's fingerprint, eye retina and iris, handprint,voice pattern, facial pattern, etc.

The gathered user information can be transmitted to the centralprocessor 12 as shown in block 6. The central processor 12 can store thegathered user information in one or more information or data stores 17.As discussed above, in various embodiments, the one or more informationstores 17 can be maintained by the transaction validating entity.

In various embodiments, when the issuing entity issues a transactioninstrument or token to the user, information associated with thetransaction instrument or token can be transmitted to the centralprocessor 12 as shown in block 8 of FIG. 1B. The information associatedwith the transaction instrument or token can include but is not limitedto name of the user, transaction amount, date of issue, expiration date,etc. In various embodiments, the information associated with thetransaction instrument or token can be encoded in the transactioninstrument or token. The transaction instrument or token information canbe stored in an information store that is different from the informationstore that includes the user information. The user information store andthe transaction instrument or token information store can have a commonfield which links the transaction instrument or token issued to an userwith the information (e.g., biometric information, etc.) associated withthat user. However, in other embodiments, the information associatedwith the transaction instrument or token can be stored in the sameinformation store that includes user information.

In various embodiments, the central processor 12 may send a confirmationas shown in block 11 of FIG. 1B. In some embodiments, the confirmationis sent to the system that transmits the user information and/or thetransaction instrument or token information. The confirmation messagecan include confirmation of the receipt of the user and/or thetransaction instrument or token information; successful enrollment ofthe user; successful update of the information stores, etc.

The above described method of enrolling users in a transactionverification system can be used for example by a company that hasseveral employees and issues payroll checks to the employees. In thisexample, the users of the transaction verification system can be theemployees. The employees can be enrolled in the transaction verificationsystem at the time they accept employment with the company subscribingor using the transaction verification system. Subsequently, every timethe company issues payroll checks to its employees, informationassociated with the payroll checks, such as the payee on the check,check number, amount of the check, etc. can be transmitted to thecentral processor 12.

When the user presents the payroll check for encashment, informationfrom the payroll check and the biometric data of the user can becompared with the corresponding information stored in the one or moreinformation stores and the results of the comparison can be used toaccept or reject the payroll check. A person skilled in the art canrecognize that the users can be enrolled in the transaction verificationsystem only once and it is not required to transmit the user informationevery time a payroll check is issued to the user.

The above described method of enrolling and verifying transactioninstruments or tokens can also be used by municipal, state and/orfederal government agencies that provide assistance to the public suchas unemployment benefits, food stamps, social security benefits,disability benefits, medical benefits, etc.

FIG. 2 illustrates an alternative embodiment of the electronictransaction verification unit 10 in communication with a centraldatabase 30 such that the central database 30 allows the data stream ofthe electronic transaction verification unit 10 to be acted upon bydecision block 32 to determine if the token verification is approved ordenied, and then returns the approval decision to the electronictransaction verification unit 10. In such embodiment, the computerplatform receives, processes, and transmits the data of the variousdevices, shown by logic block 28, to the processor 12 for comparisonwith information stored in identification database 14 included in thecentral database 30, via a communications link, for a simple comparisonstep to determine approval. The central database 30 can include acustomer account information database (i.e., transaction informationdatabase), a biometric database of known customer biometric data, aswell as a separate database of known invalid users. The database ofknown invalid users can be established by correlating a biometricpresented at a transaction location with a fraudulently obtainedtransaction token and storing the biometric as invalid.

At the central processor 12, the incoming data is compared, either inparallel with or separately with token identification data, with theexisting known data for authorized users of accounts stored in centraldatabase 30, shown by decision block 32, and an approval is made as towhether or not to accept the token. Either a yes decision 34 or a nodecision 36 on approval is then re-transmitted back to the computerhardware platform 28 of the check verification unit 10. While the checkverification unit 10 is shown in communication with a processor 12 anddatabase 30 remotely located thereto, it is not necessary that thecentral processing system 12 or the database 30 be located remotely tothe electronic transaction verification unit 10. In fact, the electronictransaction verification unit 10 and central processing system 12 can beself-contained at the transaction location whereby the central database30, or the account information and biometric databases are continuallyupdated within the electronic transaction verification unit 10 througheither a data connection to a master database or through periodic manualupdates from storage media such as floppy disks or CD ROMs. In such anembodiment, the electronic transaction verification system is preferablyself-contained and includes all the necessary devices for scanningdrivers' licenses 20, gathering biometric data (e.g., fingerprints) 18,or scanning checks/reading tokens 16 (gathering check or tokeninformation data) within one unit including the system.

FIG. 2A illustrates another embodiment of an electronic verificationunit 10 wherein the central processor 12 is configured to associatebiometric information obtained when a transaction instrument ispresented to a verification system with an information encoded on atransaction instrument if no biometric information has been previouslyassociated with the encoded information on the transaction instrument.For example, if the central processor 12 determines that no biometricinformation is associated with encoded transaction instrumentinformation in the central database 30 (as shown in the logic block 23),then a NO decision 27 is made at the logic block 23. The centralprocessor 12 then proceeds to associate the biometric information withthe encoded information. If however, the central processor 12 determinesthat biometric information was previously associated with the encodedinformation, then the central processor 12 can proceed to make adecision on whether to accept or reject the transaction instrument (asshown in block 32). As discussed above, with reference to FIG. 2, eithera YES decision 34 or a NO decision 36 on approval is then communicatedto the computer hardware platform 28 of the check verification unit 10.

In some embodiments, if the encoded information and/or the biometricinformation obtained when the transaction instrument is presented to theverification system does not match the previously stored encodedinformation and/or biometric information which is associated with thetransaction instrument, then the central processor 12 can add thetransaction instrument information and the biometric information to aninformation store that includes a list of invalid users and/ortransaction instruments.

FIG. 3 is a flow chart of an exemplary embodiment of the processinglogic of the electronic transaction verification system showing theelectronic transaction verification unit 10 where a check or token isswiped, shown by logic block 38, and a fingerprint is taken, shown bylogic block 18, with the fingerprint then being digitized, shown bylogic block 19. Both the check information data and the biometricfingerprint data are unified at the transmitting data platform, shown bylogic block 40, for parallel transmission. The transmitted data thenreaches the central processing system 12 that is in communication with acheck or token account and biometric identification database 14 suchthat a decision is made within the central processing system 12 inregard to check or token approval. As discussed previously, theidentification database 14 can include a plurality of databases used inthe identification process. One of these is the biometric database ofknown customer data. An additional biometric database of known invalidusers can also be established. The identification database 14collectively refers to the one or more biometric databases. The centralprocessing system 12 performs a decision determining if the check/tokeninformation and biometric data are consistent with an authorized userfor the account against which the check is drafted or token is provided,shown by decision block 42, whereby a yes decision 44 or a no decision46 is returned to the transaction location, shown by logic block 48.Upon return of the data from the central processing system 12, the dataindicative of the decision is displayed, shown by display block 52,and/or a hard copy is printed out, shown by document block 50,indicative of the decision made, and alternatively, the grounds foracceptance or rejection.

Various embodiments described herein accordingly utilize an inventivedigital process whereby a dataset originates from the transactionlocation from the electronic transaction verification unit 10, shown bylogic block 54, as shown in the processing logic flow chart of FIG. 4,and is preferably processed on the central processing system 12. Adecision is made as to whether information on the MICR line (e.g., “ABA”number) or on the token is valid, shown by decision block 56, and then adecision is made as to whether the biometric data (e.g. fingerprint) isthat of an authorized user, shown by decision block 62, Next, a decision(optional) is made as to whether the signature presented is that of anauthorized user, shown by decision block 68. An authorized user is anindividual authorized to use the system. An authorized user can be theaccount owner. An authorized user can also be the payee of a check, asubsequent payee or any other individual authorized to access an accountin the system. Affirmative responses to these decisions in blocks 56, 62and 68, shown by “yes” arrows 58, 64, and 70, respectively, preferablyallow further processing of the data. Negative responses, shown byarrows 60, 66, and 72, respectively, preferably effect a return of datato the transaction location indicating that the transaction isdisapproved, shown by block 74.

Once affirmative responses have been received to decisions 56, 62, and68, then the data can be further processed by accessing a frequency ofaccess database 78 which has information on accounts based upon thenumbers of inquiries to the system for a specific account, shown bylogic block 76, and such information is maintained and updated in thefrequency of account access database, shown by database 78, which can beeither integrated with or remote to the central processing system 12.Then a decision is made as to whether the current access is in excess ofa predetermined allowable amount of access inquires to the system for aspecific account, shown by decision block 80, and if the current accessis in excess of the allowable pre-determined amount, shown by “yes”arrow 82, then the data is returned to the transaction locationindicating that the requested access exceeds the allowable amount, shownby logic block 84, and thus that the transaction is disapproved.Otherwise, if the current access is not in excess of the allowablepre-determined amount, shown by “no” arrow 86, then the electronictransaction verification request is approved, shown by logic block 88.Other measures can also be used in lieu of, or in addition, to thesesteps, to verify the condition of the account. Several of the measureswere identified above.

Upon approval, the information regarding approval is transmitted, shownby arrow 90, to the frequency of account access database 78 for updatingof the records contained therein. The information regarding the approvalof the electronic transaction is then returned to the transactionlocation and electronic transaction verification unit 10, shown by logicblock 92.

The steps of the processes set forth in FIG. 4 are preferably performedby software being executed on the computer platform including thecentral processing system 12, located either at the transaction locationand integrated with the electronic transaction verification unit 10, orlocated remotely thereto. One of skill in the art of computerprogramming can determine from the present disclosure and the flowcharts disclosed herein the objects sufficient to write a program forthe computer platform sufficient to perform the tasks as disclosedherein.

In the exemplary embodiment illustrated in FIG. 7, the transactiondatabase 33 and/or the biometric database 35 within a tokenless paymentsystem can be used to verify or authenticate (decision block 37) theperson presenting a token for payment at the transaction location. Thetoken being presented at the transaction location is swiped (logic block16) obtaining the necessary account information and sent to a processor15 for comparison with account information stored in the transactioninformation database 33 within the tokenless processing system. If amatch occurs with account information stored in the transaction database33 of the tokenless system, the token system then requires the token tobe authenticated by a biometric (decision block 37). The biometricinformation is gathered (logic block 18) and then sent either separatelyor in parallel with the transaction information (logic block 28) to thetokenless system for approval.

If the account information is sent to the tokenless system transactionprocessor 15 and there is no existing account in transaction database33, then the transaction information would be processed by the normalprocedures for handling the token at the transaction location byelectronic verification unit 10. If the transaction location normallyrequires a biometric for the processing of a token then the check/tokenaccount information 16 and the biometric information 18 can be gatheredat the onset of the transaction and the tokenless databases 33, 35 thenwould be additional databases that would be checked. The transactioninformation database 33 and the biometric database 35 can be the samedatabases for both token-based and tokenless systems. Likewise, thecentral processor 12 handling token-based transactions (arrow 29) can bea separate processor or the same processor handling the tokenlesstransactions.

In one embodiment, the electronic transaction verification systempreferably includes the capability to return a report to amerchant/vendor upon request, as shown in FIG. 5. As so embodied, aninquiry and/or request is made from a merchant directed towards thecentral processing system 12, shown by logic block 94, which requests aspecific report or series of reports. The central processing system 12preferably includes access to a variety of databases 96, whichpreferably contains separate databases including a database indicativeof a number of checks cashed for a given account, shown by database 98,locations of checks cashed for a specific account, shown by database100, and a database containing various information regarding thecustomers of the account, shown by database 102. The central processingsystem 12 selectively accesses and interacts with these databases inresponse to the inquiry from the merchant at logic block 94, andgenerates a report on the specific customer or customers, shown byprocessed data logic block 104. The processed data then is returned inreport form to the specific merchant, shown by logic block 106, whichmade the inquiry and request to generate the report. Such informationgenerated by the verification system can prove highly informative as tocustomer trends such as drops in frequencies of purchases, customerdissatisfaction, or other trends that can then be effectively targetedby marketing efforts.

The present inventive electronic transaction verification system furtherprovides that after the biometric identification data, such as afingerprint, has been imprinted on the check, the system can alternatelyand/or additionally be used at a bank in conjunction with the proofingmachine to determine if the biometric identification data on the checkis that of the account owner. As shown in FIG. 6, the biometric datafrom the biometric scanning device 110, preferably at the transactionlocation 112, is sent, either electronically or physically, to theproofing machines for checks or negotiable instruments 114, typically ata bank processing center 116. In the past, checks were typically sentphysically to a bank or processing center and the magnetic line of thecheck physically scanned by the proofing machine 114. Currently, manychecks are being truncated electronically and the information containedtherein is being processed directly or indirectly by host computers atthe bank or processing centers.

In the embodiment shown in FIG. 6, the biometric data is printed on thecheck by the biometric scanning device 110 and the printed biometricdata is scanned, and thus gathered, in addition to the magnetic numbersof the check. A comparison step preferably occurs within the proofingmachine 114 during the batch processing and scanning of the magneticnumbers of the checks for transfer of funds from the accounts. Thebiometric data is retrieved and updated from a first biometric database118 that contains the biometric data for known customers havingaccounts. The proofing machine 114 also preferably perform a comparisonstep with a second biometric database 120 containing biometric data forknown invalid users who have perpetrated, or attempted to perpetrate,fraudulent activity with regard to tendering checks/negotiableinstruments. Databases 118 and 120 can reside on the proofing machine114, or can be located remotely. Such information in biometric database120 is preferably also accessible by the biometric scanning device 110at the transaction location 112 for updating and comparing, eitherseparately from or in conjunction with, the proofing machine 114. If thecheck/negotiable instrument being compared was tendered fraudulently,the biometric database 120 is useful for determining the perpetrator'sactual identity, and comparison between databases 118 and 120 can alsobe made for identity determination. In that regard, biometric database120 is also accessible by central processing system 12, identificationdatabase 14, central database 30, as well as electronic transactionverification unit 10 for detection of known fraudulent users.

The embodiments described herein can be utilized in a variety of formswith a variety of sources of information other than those described indetail herein. As an example, the electronic transaction verificationsystem can be interfaced to various transaction and identificationinformation databases containing customer account information andbiometric information.

While there have been shown a preferred and alternate embodiments of theelectronic transaction verification system, it is to be understood thatthe electronic transaction verification system may be embodied otherwisethan is herein specifically shown and described, and that within theembodiments, certain changes may be made in the form and arrangement ofthe parts without departing from the underlying ideas or principles ofthe embodiments of an electronic transaction verification system setforth in the claims appended herewith.

What is claimed is:
 1. A transaction system for processing transactionscomprising: an electronic verification system at a transaction locationof an individual or a merchant's network; and a central processingsystem comprising: one or more information stores of users authorized touse the transaction system; one or more information stores of tokeninformation received from issuing entities authorized to utilize thetransaction system; and a processing system configured to communicatewith the one or more information stores of the electronic verificationsystem; the central processing system configured to utilize a merchant'snetwork to transmit information to and from the electronic verificationsystem to a transaction facilitating entity; the central processingsystem configured to send and receive token information received from anissuing entity, the token information representative of a transactioninstrument issued to the individual by an issuing entity; the centralprocessing system configured to access the one or more informationstores of users; the central processing system configured to send andreceive information from the electronic verification system; wherein thecentral processing system and the electronic verification system areself-contained at the transaction location; and the electronicverification system comprises a biometric data reader configured toobtain biometric data from an individual, wherein the electronicverification system is configured to: receive the obtained biometricdata; generate a first comparison result by comparing the obtainedbiometric data with biometric data associated with a biometricinformation stored in the one or more information stores of users; andtransmit to the central processing system information representing thefirst comparison result; wherein the central processing system isconfigured to: transmit the first comparison result information and thetoken information representative of the transaction instrument beingprocessed to the transaction facilitating entity, receive a secondcomparison result from the transaction facilitating entity to accept ordeny the transaction; and transmit a decision by a display.
 2. Thetransaction system of claim 1, wherein the transaction information isone of a check, a debit card, a credit card, a loyalty card, a foodstamp, a token, or an account.
 3. The transaction system of claim 1,wherein the token information is representative of one of a check, adebit card, a credit card, a loyalty card, a food stamp, a token, or anaccount.
 4. The transaction system of claim 1, wherein the biometricinformation stored is representative of a finger print, a voice print, aretinal scan or a face scan.
 5. The transaction system of claim 1,wherein the electronic verification system is located at the retailer'spoint of sale.
 6. The transaction system of claim 1, wherein theelectronic verification system is at the location of the individualdoing an internet transaction.
 7. The transaction system of claim 1,wherein the electronic verification system further comprises a tokenreading device configured to read or scan, and obtain the transactioninstrument information.
 8. The transaction system claim 1, wherein theelectronic verification system further comprises a signature scanningdevice to obtain a signature from the individual.
 9. The transactionsystem of claim 1, wherein the electronic verification system furthercomprises an identity document scanning device to obtain identityinformation of the individual from an identity document.
 10. Thetransaction system of claim 1, wherein the token information isassociated with a financial account and the individual is an accountholder.
 11. The transaction system of claim 1, wherein the tokeninformation is associated with a financial account and the individual isnot an account holder.
 12. The transaction system of claim 1, whereinthe electronic verification system is configured to transmit informationrepresenting the first comparison result to the central processingsystem or the token instrument information associated with thetransaction being processed to the central processing system by themerchant's network using internet.
 13. The transaction system of claim1, wherein the electronic verification system is configured to transmitinformation representing the first comparison result to the centralprocessing system or the token instrument information associated withthe transaction being processed to the central processing system bymerchant's network using radio frequency.
 14. The transaction system ofclaim 1, wherein the electronic verification system is configured totransmit the first comparison result and the token information together.15. The transaction system of claim 1, wherein the received tokeninformation includes a number associated with the transaction instrumentissued to the individual.